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The 2014 All-Brazil Research Team: Equity Strategy, No. 2: Carlos Constantini

Carlos Constantini Itaú BBA First-place appearances: 0

Total appearances: 5

Team debut: 2010

Carlos Constantini of Itaú BBA claims the No. 2 position on this list for a second consecutive year. The strategist, who is based in São Paulo, is concerned about several global and domestic factors that are influencing Brazil’s performance, citing the implications of October presidential elections on policymaking and the regulation of different sectors, the state of the Chinese market and its effect on commodities stories in Brazil, and the U.S. recovery and the impact of interest rate rises on flows of funds. Given these issues, “plus the fact that cost of capital is particularly high in Brazil — considering the government bonds as the starting point for the calculation of the cost of equity — and valuations are not cheap,” Constantini says, he is advising investors to buy shares in defensive sectors. Examples include banks and nonbanking financials that offer high return on invested capital and growth; consumer staples; and exporters, including commodities.


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